Why Minnesota’s Community Solar Program Is The Best

Updates

Minnesota’s community solar program hit a record 513 megawatts of operational capacity in February 2019. The chart above shows the progress of projects through the program since August 2015, and the nearly two-year lag between the program launch in December 2014 and the successful ignition of multiple megawatts of capacity in January 2017.

In recent news, the Minnesota Public Utilities Commission approved an adder to compensation rates for residential subscribers in October, boosting subscriptions by 1.5 cents per kilowatt-hour for projects started in 2019 or 2020. It’s hard to say definitively, but the project queue (including new applications, projects in study, projects in design/construction, and energized projects) rebounded to over 900 megawatts by December 1st, after falling from about 950 megawatts in January 2017 to about 800 megawatts earlier this year. The adder will come on top of the revised compensation scheme for new projects in 2018––based on the value of solar.

Below is a simplified version of the chart above, showing just projects in the design/construction phase or in operation.

Also, Xcel Energy publishes data on the mix of subscribers, so we can report that more than 10,000 residential customers (92% of all subscribers) are saving money with a shared solar subscription. Although the vast majority of the program’s capacity serves commercial customers (87%), nearly one-third of the total program capacity in March 2018 (about 100 megawatts) actually serves public entities like schools. In other words, community solar helps broaden those who benefit from solar by enabling individuals and public institutions to save money with solar! We’ll continue providing these subscriber spreads month-by-month if Xcel keeps reporting them.

Original post

I’ve been asked a lot of questions about Minnesota’s community solar program over the past couple years and it’s time to make one thing clear: Minnesota’s program is the best in the country.

Minnesota’s program (see infographic) is a comprehensive approach that makes developing community solar projects economically viable and—most importantly—that does not cap the development of community solar projects. The latter is the key.

Colorado’s landmark community solar legislation, for example, caps the program at 6.5 megawatts per utility per year (although there’s hope it may increase in the future). Massachusetts has just revamped their solar renewable energy credit program to make community solar a better investment. No other state has had significant community solar development, despite 11 states that have some form of virtual net metering that allows for sharing electricity output from an off-site solar energy project.

How big is Minnesota’s projected success?

Xcel Energy’s queue for community solar already has 20 times more solar in it than the state had installed at the end of 2014. If it all gets built, it would be enough to rank second in the country in annual solar installations in 2014.

I recently wrote that a state’s solar market can’t really launch without third party ownership—leasing or power purchase agreements that allow home and business owners to install solar with zero upfront cost, hand off maintenance concerns, and save money from day one. Indiana was the only potential exception, due to a (now defunct) feed-in tariff program operated by Indianapolis Power and Light. Minnesota may be the second.

About the Author

John Farrell directs the Democratic Energy program at ILSR and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. His seminal paper, Democratizing the Electricity System, describes how to blast the roadblocks to distributed renewable energy generation, and how such small-scale renewable energy projects are the key to the biggest strides in renewable energy development.
Farrell also authored the landmark report Energy Self-Reliant States, which serves as the definitive energy atlas for the United States, detailing the state-by-state renewable electricity generation potential. Farrell regularly provides discussion and analysis of distributed renewable energy policy on his blog, Energy Self-Reliant States (energyselfreliantstates.org), and articles are regularly syndicated on Grist and Renewable Energy World.
John Farrell can also be found on Twitter @johnffarrell, or at jfarrell@ilsr.org.

The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by, and do not necessarily represent the views of Sustainable Enterprises Media, Inc., its owners, sponsors, affiliates, or subsidiaries.